It has been a volatile ride across Europe’s equity markets this year — with no sign of abating, according to the region’s top sell-side research providers.
“A lot has happened in the last twelve months; the region has actually changed quite dramatically,” said Eric Lopez, head of EMEA equity research at BofA Securities. “There are a lot of questions around not only the economic environment in Europe but also globally.”
As the region struggled to put the Covid-19 pandemic and subsequent variant waves in the rearview mirror, it has also been largely affected by supply chain issues, inflation and rising interest rates, and the invasion of Ukraine by Russia this February, which additionally drove up energy prices.
“I seem to say this more often in recent years, but equity markets remain volatile and the macro-economic outlook is uncertain,” said Theepan Jothilingam, head of EMEA research at BNP Paribas Exane. “We started the year already thinking about European and US rate hikes and inflation, [and] this hasn’t changed, but since Russia’s invasion of Ukraine, we have tried to add even more scrutiny to our analysis on industry trends across defense spend, energy prices, and food security.”